The higher the tariff, the greater the incentive to use the preference. [...] These continuity agreements, along with the Trade and Cooperation Agreement with the EU (TCA), entered into force once the UK finished its transition to depart from the EU, in 2021.1 The agreements offer the possibility for the UK of zero-tariff trade for most products, with some products having a longer period for the tariff liberalisation schedule, also leading to zero-tariff trade in the medium. [...] For each country in the export shares column, the figures in bold represent the five sectors with the largest export shares to each of the partners. [...] We also applied the ROO-RI to the rules of the Canada and Korea agreements and find an average restrictiveness index of 3.76 for the former and 4.58 for the latter. [...] The higher score for the UK-Korea FTA, on the other hand, is largely driven by the high number of products ruled by the Change in the Heading (ΔCTH) rule, scored 6.
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Table of Contents
- KEY POINTS 1
- INTRODUCTION 2
- UK EXPORTS AND MFN TARIFFS 2
- PREFERENCE UTILISATION RATES 4
- RULES OF ORIGIN 7
- Agreements Cumulation of Origin Transportation rule Time-restriction 8
- Tolerance 8
- UK-EU 8
- UK traders can use EU inputs in exports to the EU as if they originated in the UK. No applicable 10 to 15 8
- UK-Korea 8
- UK traders can use EU inputs in exports to Korea as if they originated in the UK. 8
- Transits through the EU face different restrictions than transits outside the EU. 8
- Both rules are extended for two more years since January 2024 10 8
- UK-Canada 8
- UK traders can use EU inputs in exports to Canada as if they originated in the UK. 8
- Transits through the EU face same restrictions than transits outside the EU. 8
- UK exporters cannot longer consider EU inputs as originating in exports to Canada since April 2024. 10 8
- DETERMINANTS OF PREFERENCE UTILISATION 11
- CONCLUSION 15
- The UK Trade Policy Observatory UKTPO a partnership between the University of Sussex and Chatham House is an independent expert group that 16
- ABOUT THE AUTHORS 16
- Adriana Brenis is a Research Fellow of the UK Trade Policy Observatory UKTPO at the University of Sussex Business School. 16
- Michael Gasiorek is Co-Director of the UKTPO Co-Director of the CITP and Professor of Economics at the University of Sussex. 16
- Manuel Tong Koecklin is a Research Fellow in the Economics of Trade at the UK Trade Policy Observatory and University of Sussex Business School. 16
- ISBN 978-1-912044-39-9 16
- UKTPO University of Sussex 2024. 16
- As copyright holder UKTPO requests due acknowledgement. For online use we ask readers to link to the original resource on the UKTPO website. 16
